NRLCA: House Committee Passes H.R. 3813; Slashes Federal Employee Benefits

WASHINGTON, DC – The House of Representatives Oversight and Government Reform Committee passed a controversial federal benefits bill on February 7, 2012 that would increase the amount federal employees contribute to their government pensions, thus lowering take-home pay.

The Committee was split on party lines, 22-to-16, to approve H.R. 3813, the “Securing Annuities for Federal Employees Act of 2012”. Ranking Member Elijah Cummings (D-MD) opposed the legislation and said the bill would be damaging to federal employees who at the time of enactment in 2013, would have already been subject to a two-year pay freeze. Gerry Connolly (D-VA) also opposed the bill and stated, “It is a sad day when the leadership of the Oversight and [Government] Reform Committee most closely resembles a wrecking crew which will not rest until it has torn what should be the world’s model of civil service.”

The bill will establish a new pension formula beginning in 2013. Current federal employees would be required to pay 1.5 percent above the 0.8 percent they currently pay into their pension programs. This will be phased in over the course of 3 years and will ultimately require FERS employees to contribute 2.8 percent of each paycheck to pensions, while CSRS employees will contribute 8.5 percent of each paycheck to pensions.

Employees entering the workforce after January 1, 2013, with less than 5 years of civil service, will be required to pay 4 percent into federal pension funds and 6.2% into Social Security. This amounts to 10.2% out of a new employee’s salary, which does not include contributions to Thrift Savings Plan (TSP). These new employees will be referred to as “Secure Annuity Employees”, whose years of service calculation will be based off of a “high-5” instead of the current “high-3”.

The bill will also eliminate a current provision that provides a social security supplement to those who retire before age 62, when eligible for social security benefits.

The Committee business meeting was not completely partisan, however. In a joint amendment, Rep. Lynch (D-MA) and Rep. Chaffetz (R-UT) adopted a provision that allows federal retirees to deposit unused annual leave into their TSP accounts.

Shortly after the bill passed the O&GR Committee, the Rules Committee inserted it to be included in HR 7, the American Energy and Infrastructure Jobs Act. In basic terms, the savings calculated from slashing federal employee benefits will be used to pay for highway construction and transportation funding.

The NRLCA vehemently opposes the inclusion of HR 3813 to pay for a transportation funding bill and will be working with Members of the House to defeat this unfair legislation.

via National Rural Letter Carriers’ Association.